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Tuesday, 30 August 2016

Wall Street rises as hawkish Fed boosts financial stocks

Wall Street rose on Monday morning, helped by financial stocks that gained a day after Federal Reserve Chair Janet Yellen said the case for an interest rate hike had strengthened.

Yellen, addressing a gathering of global central bankers on Friday, said the central bank was close to meeting its goals of maximum employment and stable prices, while describing consumer spending as "solid".

Yellen gave little indication of when the Fed would move but Vice Chairman Stanley Fischer suggested that a move as soon as next month could be possible.

"It's a delicate yet deliberate delivery of reality," said Andre Bakhos, managing director at Janlyn Capital. "Rates are going to move higher, based on the economic evidence, but the "when" of the move is up in the air."

Financial stocks, which stand to gain the most in a higher interest rate environment, rose as traders raised bets on a hike in the coming months.